Economics · Theory of Production
A farm produces wheat and uses fertilizer as a variable input. When fertilizer application increases from 5 to 10 kg, total product rises from 40 to 70 kg (an increase of 30 kg). When it increases from 10 to 15 kg, output rises from 70 to 85 kg (an increase of 15 kg). What does this pattern indicate?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Increasing marginal returns
- 2Negative marginal returns
- 3Diminishing marginal returns✓
- 4Law of constant marginal returns
Correct answer
Diminishing marginal returns
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